Britain may remain trapped in a low-growth straitjacket for several years
because of deep-seated fractures in the global economy, Sir Mervyn King, the
Governor of the Bank of England, warned yesterday.

In a grim assessment three weeks before the Chancellor’s Autumn Statement, the
Bank said that Britain faced “persistently low growth” and admitted that the
authorities had little capability to kick-start a strong recovery.

The analysis in the quarterly Inflation Report represents a sharp break from
previous Bank outlooks, which have repeatedly over-estimated the economy’s
ability to spring back from the banking crash.